Within the past couple of months, the Chinese have been venturing out of Asia to seek property investments. Nearly 2.5 billion dollars has been invested in real estate in London alone. This was the top destination in the world with the other cities being in Australia, the United States, and other metropolitan areas throughout the world. Many of these investors are the development firms and insurance companies with a great amount of capital.
These investors get perks besides the property that they have invested in. The English government has helped with immigration of the investors as the economic impact of these investments is equally beneficial. There is over 1 trillion dollars at stake if these investments yield profit and the Chinese and English government’s relationship stays friendly.
Why Invest Overseas?
The Chinese are running into issues when trying to borrow money from banks in their homeland. There has been increase competition from the smaller developers and the demand for the giant projects that these developers crave have been decreasing in demand. Some countries do not have a foreign friendly tax laws but this is not the case for every country. London actually has some of the most friendly foreign investment tax laws. London also has a great banking and financial industry which makes them the glass slipper of sorts for foreign investment. The commercial leases of buildings also tend to be longer in London specifically rather than the much shorter leases in the Far East.
Right now there are more than 35 Chinese companies that have an office or are leasing office space in London. The company that is the largest is the Bank of China who ironically bought the building next to the Bank of England. The Chinese are not the only people leasing office space in the city. There is growth throughout the city on all levels. The Chinese have a leg up on most of the competition though from their experience. The Chinese have been investing in London businesses and real estate for a number of years because of their laws and taxes but also the non-reliance on the dollar. This will continue to grow as compared to the rest of the EU, the London real estate market is booming while it is also a financial hub for many global businesses. Compared to the rest of Europe, London is a great place once the Chinese have secured all of their office locations in the Far East.
The office space has grown exponentially with roughly an over 40 percent growth in square feet being leased. The global recovery after the global financial crisis lends itself to this happening. This growth is expected to continue as the global market is improving with London being a great destination to open up headquarters. Having a commercial property consultant is also important so you can get the best deal to launch your newest headquarters.
The Chinese investing in London looks to continue for years to come and the English couldn’t be happier. This will improve the economy while helping improve the city with giant high quality structures that are being built.
